The nation’s municipalities are teetering on the brink of financial collapse, prompting a stark warning from the President of the German Association of Cities, Burkhard Jung, who is urging the federal government and state premiers to provide immediate financial assistance at their upcoming conference. Jung, a prominent SPD politician, voiced concerns to Funke-Mediengruppe newspapers, emphasizing that cities, even those traditionally considered affluent in southern Germany, are now experiencing budget breakdowns.
The looming deficit within municipal budgets is projected to exceed 30 billion euros this year, a figure demanding urgent intervention. Jung cautioned that under emergency budgetary procedures, municipalities are restricted to fulfilling only legally mandated or contractually obligated services. This curtailment extends to seemingly minor expenses – even subsidies for sports clubs are now under scrutiny.
Chancellor Friedrich Merz (CDU) and the state premiers are facing increasing pressure to move beyond merely proposing mid-term reforms. Jung directly warned of the potential damage to local democracy should citizens perceive the state solely as a body managing deficiencies. He emphasized that this perception could severely undermine the foundations of local self-governance.
The stark imbalance in funding is at the core of the crisis. Jung highlighted a fundamental inequity: municipalities contribute roughly a quarter of the nation’s overall spending but are allocated only a seventh of tax revenues. This unsustainable model has now materialized into tangible consequences across the country, including the elimination of bus routes, inadequate maintenance of daycare centers and schools, the closure of dilapidated gymnasiums and reductions in road maintenance.
Furthermore, Jung criticized the inadequate distribution of the 100 billion euro investment package from the special asset fund. He reported that most states have passed on only around 60% of these funds to the municipalities, exacerbating the situation as reserves have been depleted over recent years. The president underscored the gravity of the situation, stating that the very substance of essential public services and local democracy is now threatened. He vehemently warned that failing to address this crisis risks long-term damage to the federal republic’s civic fabric.
